The federal government wants to close a child support loophole. Here's what it would mean

A loophole restricting the ability for child support to be recovered once a person turns 18 will be closed under a new government plan targeting 18,000 parents.

Social Services Minister Anne Ruston.

Social Services Minister Anne Ruston. Source: AAP

Services Australia will have the power to dock the wages of more parents who aren't paying child support under a $7.8 million plan targeting over 18,000 people.

The move aims to close a loophole where it's "effectively case closed once a child turns 18" when trying to recover a debt, Social Services Minister Anne Ruston said.

"The new approach will allow Services Australia to dock parents' pay packet to repay child support in more circumstances including after a child turns 18," Ms Ruston said on Saturday.

Advertisement


The changes will also target parents who are overpaid child support because they earned more than they reported, but held off filing a tax return to avoid paying back the other parent.

The government said it will legislate to enable child support to be recovered in more circumstances, with the total debt pool currently sitting at $1.69 billion including active and closed cases.

It's estimated the new measures will recover about $164 million related to closed cases from 18,250 parents

And with international travel back on the cards for more people, Ms Ruston said the government will strengthen the Departure Prohibition Order system which prevents parents who fail to pay child support from leaving Australia.

"Currently Services Australia must issue an exemption known as a Departure Authorisation Certificate if the parent provides a down payment on their debt," she said.



"But, disappointingly, we know some parents will make a down payment so they can leave the country and have no intention of paying off the rest of their debt.

"This measure gives Services Australia the discretion to refuse an exemption if they have reason to believe the parent is likely to shirk their responsibilities and fail to pay back the remainder of the debt when they return to Australia."

Since July 2017, 5,394 parents have been issued with a travel ban enabling the recovery of more than nearly $100 million.

"This is money that is helping to put food on the table and clothes on the backs of thousands of Australian children," Ms Ruston said.


SHARE
2 min read
Published 22 January 2022 at 1:38pm
Source: AAP,SBS